Court File and Parties
COURT FILE NO.: CV-12-458715 DATE: 20240422 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Bedros (Peter) Avedian, Claudio Petti and Mario D’Orazio, Plaintiffs AND: Enbridge Gas Distribution Inc., operating as Enbridge Gas Distribution, Enbridge Solutions Inc. operating as Enbridge Energy Solutions, Enbridge Inc., Lakeside Performance Gas Services Ltd. operating as Lakeside Gas Services, Defendants AND: Alpha Delta Heating Contractor Inc. and Aubrey Leonard Dey, Third Parties AND: TBQ Heating and Air Conditioning, Brentol Bishop a.k.a. Brent Bishop, Enbridge Solutions Inc. operating as Enbridge Energy Solutions and Enbridge Inc., Fourth Parties
BEFORE: Darla A. Wilson J.
COUNSEL: Christine G. Carter, Jean Pierre Bouchard, Counsel for the Plaintiffs James G. Norton, Counsel for the Defendants Enbridge Gas Distribution Inc. and Lakeside Performance Gas Services Ltd. o/a Lakeside Gas Services C. Kirk Boggs, Counsel for the Alpha Dey Heating and Aubrey Leonard Dey Chris Morrison, Counsel for the TBQ Heating and Air Conditioning, Brentol Bishop a.k.a. Brent Bishop David Reiter, Counsel for Fourth Party Enbridge Solutions Inc. o/a Enbridge Energy Solutions and Enbridge Inc.
HEARD: February 12 and 13, 2024
Endorsement
1In August of 2010, Bedros Avedian (“Avedian”), Claudio Petti (“Petti”) and Mario D’Orazio (“D’Orazio) bought an apartment building located at 399 Markham Road in Scarborough. It was purchased in the name of 1815212 Ontario Inc. (“1815”); each of the Plaintiffs incorporated a company in which each Plaintiff owned all of the shares. These 3 holding companies owned the shares in 1815. On September 14, 2010, there was an explosion and fire at the building. That event gives rise to this action: a claim for damages as a result of the negligence of the Defendants. The statement of claim was issued on July 12, 2012.
2In addition to the claims of 1815, there was also an action for personal injuries initiated by Ms. Mullapudi (action CV-12-463425) and another action which was a subrogated claim for property damage and business interruption losses (CV-12-463409). Those claims have been resolved.
3In my capacity as the case management judge, I scheduled three motions: the Plaintiffs’ motion to strike the pleadings of the opposing parties for the failure to disclose settlement agreements; the Defendants’ motion for directions concerning the damage claims that can be asserted at trial; and the Plaintiffs’ motion for my recusal as the case management and trial judge. I scheduled the motions according to the time of service and I will deal with them in the same order.
Background
4I will set out the relevant events chronologically to give context to the 3 motions that I must determine.
5Enbridge Gas Distribution Inc. (“Enbridge Inc.”), Enbridge Gas Distribution Inc. (“Enbridge Gas”), Lakeside Performance Gas Services Ltd. (“Lakeside”) and Enbridge Solutions Inc. (“Enbridge Solutions”) were named as Defendants. Lakeside issued a third party claim against Alpha Delta Heating Contractor Inc. and Aubrey Dey (“Alpha Dey”). Alpha Dey issued fourth party actions against TQB Heating and Air Conditioning and Brentol Bishop (“TQB and Bishop”). Alpha Dey and Bishop are not defendants in the main action. I will refer to the Defendants Enbridge Gas and Lakeside together with the third and fourth parties collectively as “the Defendants”. While this is not technically correct, they adopt the same position on these motions. Enbridge Inc. is in a different position and will not be grouped with the other Defendants; it did not participate in the motions.
6The action proceeded through the usual steps in a litigation file: productions; examinations for discovery in 2017 and 2018; and mediation. It was set down for trial and a trial date was set for May 2020 for a period of 50 trial days.
7In September 2019, Justice Ferguson was appointed the case management judge pursuant to Rule 77 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. Her Honour noted that the case was not ready for trial, notwithstanding the trial date of May 2020. The Statement of Claim alleged that Enbridge Inc. exerted operational control over Enbridge Gas, a position that was disputed from the outset by Enbridge Inc. which had sought its release from the action after delivering a statutory declaration in 2016 confirming that it had no operational control over Enbridge Gas. Enbridge Inc. brought a motion for partial summary judgment, which was granted by the case management judge in reasons released April 13, 2020. The Plaintiffs appealed that decision.
8In reasons released May 31, 2021, the Court of Appeal overturned the decision and directed “the matter is to be set down for trial on an expedited basis.” Following the decision of the Court of Appeal, I was appointed by Regional Senior Justice Firestone as the case management judge replacing Justice Ferguson. With the consent of all counsel, it was agreed I would also be the trial judge and that I would deal with all matters, except the pretrial conference.
9At the initial case conference over which I presided in August 2021, I was advised that the Defendants, except for Enbridge Inc., had admitted liability for the explosion, so that was not an issue that needed to be adjudicated at trial. The Plaintiffs wished to fix a new trial date. However, there was uncertainty about the nature of the damage claims the Plaintiffs intended to advance at trial. The Plaintiffs took the position they were entitled to assert damages on behalf of the individual Plaintiffs, and that the Statement of Claim permitted these damage claims; the defence counsel disagreed. Consequently, I directed the Plaintiffs to serve a proposed amended statement of claim. That was done and the Defendants did not agree with the changes. As a result, I directed the Plaintiffs to bring a motion to amend the statement of claim to clarify the damages being sought.
10In March, 2022, I heard the motion and in written reasons released June 3, 2022, I dismissed the motion of the Plaintiffs to amend the statement of claim in accordance with the draft amended claim; the Plaintiffs appealed that order.
11Shortly after release of my reasons, in June 2022, the solicitor for the Plaintiffs served an expert report that set out a financial loss claimed by the Plaintiffs based on a theory that but for the 2010 explosion, the Plaintiffs would have leveraged the Markham Road apartment building and purchased another commercial building located at 730 Clarens Avenue. Because they were unable to do so, the expert report quantified the losses to the Plaintiffs arising from the explosion at some $60 million. Counsel for the Defendants objected, stating that the “reinvestment claim” was a new claim, one that was not pleaded and had not been advanced.
12The Plaintiffs brought a motion on February 24, 2023 before a judge of the Court of Appeal seeking a variety of relief, including an order striking the defences of the Defendants and obtaining production of any and all litigation agreements entered into by the Defendants. Justice Pepall declined to hear the Plaintiffs’ motion and referred it back to me as case management judge.
13In reasons released April 25, 2023, the Court of Appeal dismissed the appeal of the Plaintiffs from my order refusing the proposed amendments to the Statement of Claim. I convened another case conference on June 9, 2023 at which time the solicitor for the Plaintiffs confirmed that she wished to fix a trial date. I indicated that if there were further motions to be argued, the case was not ready for trial. After some discussion with counsel, a trial date of January 2024 was selected on consent and the Plaintiffs indicated that they would not pursue their motion to strike the defences at that time.
14At a further case conference held August 16, 2023, I was advised of two developments: the Plaintiffs and Enbridge Inc. had settled their issues so that Enbridge Inc. would be released from the action; and counsel did not agree on whether the “reinvestment claim” as set out in the June 2022 expert report could be advanced at trial. I implored counsel to consider their positions and attempt to work the issues out so the case could move forward to trial. In my endorsement, I noted “I had understood that all parties were ready to proceed to trial in January 2024. I had also understood that once the Court of Appeal had rendered its decision on the motion by the Plaintiffs to amend the Statement of Claim, issues related to the pleadings and the type of claims that can be asserted at trial had been disposed of. Apparently, that is not the case.”
15Subsequently, I was advised that counsel could not resolve their differences and motions were necessary. At a further case conference held September 27, 2023, I advised that the motion for directions would have to be determined prior to the trial and I directed counsel for the Plaintiffs to serve responding materials so that a motion date could be set.
16Another case conference was held and in my order of October 3, 2023, I vacated the pretrial date which was set for October 24, 2023. In a further direction on October 5, 2023, I confirmed the trial date in January 2024 would have to be adjourned to permit the motions to be argued. I indicated that if counsel agreed on a timeframe by which the case would be ready for trial, I would fix another trial date. My two case management orders are referred to as the October 3 and 5 orders.
17At a case management conference held November 22, 2023, I was apprised of 3 things: that the Plaintiffs wished to schedule their motion to strike the pleadings for failure to disclose settlement agreement(s); that the Plaintiffs had sought leave to appeal my 2 case management orders from October directing the hearing of the motion for directions and vacating the pretrial and trial dates; and finally, that Ms. Carter had written to Regional Senior Justice Firestone on September 29, 2023 stating the Plaintiffs believed I had a reasonable apprehension of bias and requesting that my case management orders be reversed, and that the trial and pretrial dates be reinstated.
18RSJ Firestone advised Ms. Carter that any motion for recusal had to be brought before the presiding judge on a proper record; consequently, Ms. Carter requested that the motion for recusal be scheduled as well. As a result, the three motions were scheduled to be heard February 12 and 13, 2024.
19The Plaintiffs’ applications for leave to appeal my case management orders of October 2023 were dismissed with costs by Divisional Court on December 8, 2023. The Plaintiffs also sought an order staying my orders of October 3 and 5, 2023 pending their motion for leave to appeal the Orders. That motion was dismissed by Justice Simmons on January 23, 2024. The appeal by the Plaintiffs of the order of Justice Simmons was dismissed by a 3-judge panel of the Court of Appeal on April 4, 2024. It is unclear to me if there are any further appeals outstanding.
20At the outset of the hearing of the three motions, Ms. Carter asked for an adjournment of the motion for directions and the motion to strike the defences and wished only to proceed with the motion for my recusal. This request was opposed by defence counsel. I declined to adjourn the motions. The motion to strike the pleadings and the motion for directions had been served months ago, with timetables set for the delivery of materials, and the motions were ready to be argued. The case management order of November 22, 2023 fixing the dates for the hearing of these motions and setting a timetable for delivery of materials was not appealed. An adjournment of the motions would simply delay the action, and the Plaintiffs are clear that they wish to move the case forward to trial.
Motion to Strike Pleadings
21The Plaintiffs bring the motion to strike the pleadings of all opposing parties except for Enbridge Inc. on the basis that these parties failed to produce litigation agreements that “have changed the litigation landscape.” Ms. Carter requests an order that these Defendants not be allowed to participate in the trial. She also asks that opposing counsel bring the litigation agreements to court and allow her to review them. Filed in support of this motion is the affidavit of Mr. Avedian sworn April 28, 2023.
22For clarity, there are two agreements that are referenced and sought to be produced by the Plaintiffs. The first is the agreement by the Defendants that Enbridge Inc. bears no liability in this action and the claim and crossclaims ought to be dismissed as against it. The second is the agreement that Enbridge Gas and Lakeside would admit liability and the Defendants and the third and fourth parties would agree to an apportionment of payments between them.
Position of the Plaintiffs
23Ms. Carter submits that in the pleadings, all the Defendants denied liability and blamed other Defendants for the explosion. By the time the summary judgment motion was served by Enbridge Inc., in 2019, the positions of the Defendants changed with their confirmation to let Enbridge Inc. out of the action. Ms. Carter describes this as a “realignment” that necessitated disclosure of the defence agreements that underlie this change in position, in accordance with the principles enunciated in Handley Estate v. DTE Industries Limited, 2018 ONCA 324, 421 D.L.R. (4th) 636.
24In July 2021, Ms. Carter was advised that the Defendants Enbridge Gas and Lakeside were making an admission of liability for the explosion. The Plaintiffs submit that following the admission of liability, the positions of the Defendants changed, and procedural fairness requires the disclosure of the agreements. The Plaintiffs cannot proceed to trial “in the dark”. Despite requests from the solicitor for the Plaintiffs, the Defendants have failed to produce the agreements or advise of the particulars. As a result, consistent with the decision in the Handley Estate case and several other appellate decisions, the only remedy is to strike their pleadings.
Position of the Defendants
25While counsel for the Defendants concur that some litigation agreements must be disclosed so that parties can make strategic decisions concerning the litigation, other agreements that don’t change the litigation landscape need not be disclosed. The jurisprudence is clear that a case which changes the litigation landscape is one that significantly alters the dynamics of the case, which is not the case here.
26The decision to dismiss the claims against Enbridge Inc. in the face of the motion for summary judgment did not change the position of the Defendants; they did not plead Enbridge Inc. was at fault for the explosion and never took the position that it was a necessary party.
27The combined decision to make an admission of liability is not an agreement as contemplated in the Handley Estate case. Rather, it simplified the issues for trial and removed the requirement that the Plaintiffs prove negligence against the Defendants. The agreement between Defendants to settle the other 2 actions is irrelevant to the claims of these Plaintiffs and there is no obligation to disclose the particulars to the solicitor for the Plaintiffs. Furthermore, any agreement between the Defendants and the other parties concerning funding is irrelevant to the interests of the Plaintiffs. In sum, there has been no change in the dynamics of the case concerning the Plaintiffs and there is no requirement for disclosure of the decisions concerning Enbridge Inc. and the admission of liability.
Analysis
28Handley Estate and subsequent appellate decisions have articulated and expanded on the obligation of immediate disclosure of settlement agreements that “change entirely the landscape of the litigation” (Handley Estate, at para. 45). Most often, this arises where there is a partial settlement agreement between the Plaintiff and one or more of the Defendants, commonly referred to as Mary Carter agreements or Pierringer agreements. The question for my determination is whether when the various Defendants agreed that no liability rested with Enbridge Inc. and when the admission of liability was made these are the types of agreements referenced in Handley Estate that require immediate disclosure to the Plaintiffs.
Decision in 2019 to dismiss the claims against Enbridge Inc.
29The fact that a party changes its position from that set out in its pleadings, in my view, cannot and does not automatically mean that there has been a “change in the litigation landscape”. What constitutes such a change has been the subject of judicial commentary in numerous cases. It is one that has “the effect of changing entirely the landscape of the litigation in a way that significantly alters the dynamics of the litigation.” Crestwood Preparatory College Inc. v. Smith, 2022 ONCA 743, 164 O.R. (3d) 291, at para. 57.
30In Skymark Finance Corporation v. Ontario, 2023 ONCA 234, 166 O.R. (3d) 131, at para. 55, Justice Trotter stated, “The necessary magnitude of the change to the litigation landscape must be informed by the values that the rule is meant to advance. This court has repeatedly held that the rule is meant to preserve fairness to the parties. It is also designed to preserve the integrity of the court process.” It is not every agreement that requires disclosure. Litigation agreements that change the adversarial relationships between parties, such as Mary Carter agreements, must be disclosed: Laudon v. Roberts, 2009 ONCA 383, 308 D.L.R. (4th) 422. This is because these agreements are between a Plaintiff and a Defendant, who were adverse in interest, but subsequently enter into a cooperative agreement. As a result, the agreement will usually have an impact on the strategy and evidence for trial of other Defendants. That is why as a matter of fairness, these agreements must be disclosed to other parties and to the Court.
31However, that is not the case in this action. From the outset, the Defendants Enbridge Gas and Lakeside took the position that Enbridge Inc. was not a proper party to the lawsuit and not liable for the damages of the Plaintiffs. Thus, there was no change in position when these Defendants agreed to dismiss the claims against Enbridge Inc. prior to the hearing of the summary judgment motion. These Defendants did not crossclaim against Enbridge Inc. and never adopted the position that it was somehow liable for the explosion. This was the same position adopted by Alpha and TQB in May 2019 when the summary judgment motion was brought. To be clear, the motion for summary judgment brought by Enbridge Inc. was necessitated by the refusal of the Plaintiffs to agree that they were not a proper party to the lawsuit. The only responding parties on that motion were the Plaintiffs.
32In her submissions and in the factum of the Plaintiffs, Ms. Carter submits that when Enbridge Inc. stated in its partial summary judgment motion materials that no party but the Plaintiffs would be blaming Enbridge Inc. for the incident, that “came as a surprise to the Plaintiff and their counsel.” I cannot accept that submission, since Ms. Carter has known since 2013 when the statement of defence was delivered by Enbridge Gas and Lakeside that they were not alleging negligence on the part of Enbridge Inc. There was no crossclaim against Enbridge Inc. nor any allegations of negligence. Thus, Ms. Carter knew from the outset that the other Defendants were not taking the position that Enbridge Inc. was somehow responsible for the explosion or should share in the liability.
33Furthermore, in the affidavit of Mr. Boggs filed in response to this motion there are emails in June 2019 exchanged between counsel that confirm that all of the other parties agreed that Enbridge Inc. was not responsible in any fashion for the explosion and ought to be released from the action.
34The Plaintiffs have filed the affidavit of Mr. Avedian in support of this motion. As a party, and not counsel, he likely would not appreciate the ramifications of things such as agreeing to let a party out of an action without costs or agreeing on an apportionment between negligent tortfeasors to pay damages or even the consequences of an admission of liability. I note this without in any way being critical of Mr. Avedian. It is counsel who is aware of concepts such as litigation strategy, contribution and indemnity requirements and proving negligence through evidence at trial. Furthermore, some of the statements in his affidavit are inaccurate, because he did not participate in the case management conferences. On a motion to strike pleadings for failure to disclose settlement agreements, I would have expected an affidavit sworn by counsel.
35The affidavit of Mr. Avedian states that there must be some sort of agreement between the Defendants not to “blame” Enbridge Inc. It is unclear what the basis of this belief is, given that the sworn evidence from both Mr. Boggs and Ms. Sefton is that the only agreement was to dismiss the action against Enbridge Inc. without costs, which is the standard agreement when a party’s involvement in an action is being brought to an end.
36In his affidavit, at paragraph 42, Mr. Boggs states that as of January 9, 2020 when Ms. Carter inquired about a litigation agreement, he confirmed that no such agreement existed. On the same date, counsel for Enbridge Inc. confirmed this as well. It is clear on the evidence filed on these motions that there is no agreement between the parties defending the action concerning Enbridge Inc. There is nothing to be produced.
37The Plaintiffs sued Enbridge Inc. on the basis that they failed to retain competent contractors to do their work, or they failed to properly train them; in short, Enbridge Inc. was alleged to have been negligent in its capacity as a manager of the contractors who did the work. The solicitor for the Plaintiffs heard the evidence of the Defendants and of the other parties at the examinations for discovery and would have been in a position to assess the likelihood of proving a claim in negligence against Enbridge Inc. at that point. It was up to the Plaintiffs to determine whether to continue on with the case against Enbridge Inc. in 2019 when Enbridge Inc. demanded to be let out of the action. The agreement of the other parties to dismiss the action against Enbridge Inc. had no impact on whether or not the Plaintiffs decided to continue to assert negligence against that party. The Plaintiffs had the obligation to prove the case in negligence against Enbridge Inc. They knew from the time of pleadings that the Defendants were not joining them in attempting to prove negligence against Enbridge Inc. for the explosion.
38It is not an unusual event for a Plaintiff to obtain information at the examination for discovery of a Defendant that makes it clear that the chance of success against that party, based on the facts of the case, is not strong. That is the appropriate time for a Plaintiff to decide if the action will proceed against all Defendants who were named in the Statement of Claim. The Plaintiffs obviously wished to pursue their claims against Enbridge Inc. and that is what resulted in the decision of Enbridge Inc. to bring a summary judgment motion. The Defendants concurred that there was no case to be made against Enbridge Inc. so they wished to make their position clear and avoid a possible costs order from the motion judge.
39In her submissions, Ms. Carter suggests that the discussions between the Defendants and the third and fourth parties were somehow relevant to her considerations concerning the continued involvement of Enbridge Inc. I reject this submission; the Plaintiffs did not sue Alpha Dey or TQB so whatever discussions were ongoing between those parties had no impact on any litigation strategies of the Plaintiffs. Furthermore, the Plaintiffs had the onus of proving their case against Enbridge Inc.; the fact that the other parties were of the view that Enbridge Inc. bore no liability for the explosion doesn’t alter the fact that the Plaintiffs sued Enbridge Inc. and had the obligation to prove liability against it.
40To put it simply, the Plaintiffs sued Enbridge Inc. and had to prove a case against that entity separate and distinct from proving negligence against the contractors who performed the work at the apartment building. I do not accept that the litigation landscape changed for the Plaintiffs when all of the other parties agreed that Enbridge Inc. should no longer be involved in the action. The dynamics between the parties did not change; the summary judgment motion was brought by Enbridge Inc. because they wished their release from the action and all of the parties except for the Plaintiffs had agreed with that position. It did not change the playing field nor did it impact the case the Plaintiffs had to meet at trial such that it would effect the litigation strategy. There is no need for disclosure to Ms. Carter concerning any decision by the other parties to dismiss the action against Enbridge Inc.
Agreement on liability July 2021
41The sworn evidence from Mr. Boggs is that in 2019, the Defendants were able to arrive at a without prejudice funding of any settlements which enabled them to resolve the personal injury claim of Mullapudi in 2019 and the subrogated action for the business interruption losses in 2020.
42As well, Mr. Boggs deposes that the various Defendants wished to streamline the trial process so that liability would be admitted and the action would proceed to trial on the damages issues only. The prior case management judge, Justice Ferguson, wished to shorten the length of trial from 50 days. This culminated in the email of July 16, 2021 from Mr. Norton to Ms. Carter advising that Enbridge Gas and Lakeside “will admit that they are liable to the Plaintiffs for the cause of the gas explosion that took place on September 14, 2010 that is the subject of this action. As part of reaching the stage where this admission can be made, I can also advise that these two defendants have entered into an agreement respecting liability with the third and fourth parties with the result that there is no remining liability lis between the Plaintiffs and Enbridge Gas, Lakeside, Dey and TQB…All of the Defendants are of the view that the settling parties and the Plaintiffs should proceed to trial on damages issues only….” Following receipt of the liability admission, Ms. Carter requested a copy of the “agreements.” She also advised opposing counsel that she did not consent to this information being imparted to me as the new case management judge.
43On this motion, Ms. Carter submits that the “undisclosed agreements contain a provision whereby the third and fourth parties have limited or capped their exposure to their policy limits.” The first problem with this submission is that there is no evidence to support it; it is simply conjecture. The second problem is that there is nothing in the record before me that suggests that the policy limits of the liable defendants are insufficient to satisfy all claims by the Plaintiffs. To the contrary, the correspondence from counsel for Enbridge Gas dated July 16, 2021 states “…the settling parties would be able to satisfy any judgment the Plaintiff might obtain.”
44The Plaintiffs’ demand for production of some sort of settlement agreement between the Defendants and the third and fourth parties seems to be based on the incorrect assumption that once a party departs from a position contained in its pleading, there must be immediate disclosure of the “agreement” which is responsible for the change in position. That is an incorrect statement in law.
45Ms. Carter suggests that with the admission of liability, the landscape changed, making it more difficult for the Plaintiffs to establish liability on Enbridge Inc. Ms. Carter submits that once the admission of liability was made, the Plaintiffs were somehow disadvantaged because the evidence of the subcontractors, Lakeside, Alpha Dey and TQB, was necessary in order for the Plaintiffs to establish liability against Enbridge Inc. I do not accept this submission. The law is clear that a Plaintiff must prove negligence against all Defendants it chooses to sue and proceed to trial against. The Plaintiffs did not sue Alpha Dey or TQB; these parties were included in the action as a result of third and fourth party claims issued after the main action was instituted. To suggest that the admission of liability changed the litigation landscape between the parties is incorrect; it simply removed one of the issues for determination at trial, that of liability. It did not change the adversarial position of the parties concerning the damages alleged by the Plaintiffs, nor did it effect the dynamics of the litigation. If Ms. Carter wished to have the evidence of the third and fourth parties at trial to make the Plaintiffs case against Enbridge Inc. there were means by which to accomplish that. The fact that the Defendants chose to resolve the other litigation had absolutely no effect on this action.
46Simply because a trial will not involve the adjudication of all issues that are pleaded in a statement of claim does not mean that production of agreements entered into narrowing issues must be made. Parties are encouraged, at the appropriate juncture, to make admissions to reduce the number of matters that require adjudication by the Court. Here, the Defendants and the third and fourth parties arrived at an agreement on apportionment between themselves which enabled an admission of liability to be made in this action and which permitted the resolution of the other litigation. The third and fourth party claims are not settled, as suggested in the affidavit of Mr. Avedian. This appears to be speculation on his part, or perhaps a misunderstanding. The affidavit of Mr. Boggs clarifies the situation.
47In most negligence cases, the Plaintiff pleads broadly against various Defendants based on the limited information available at the time the statement of claim must be issued. Defendants may and often are included that had no involvement in the facts giving rise to the claim. However, a prudent solicitor must include all possible Defendants or risk missing a limitation period. Pleadings must be served and filed within a strict time limit and as a result, often parties do not have all of the information necessary to know and evaluate a case going forward or, in the case of responding parties, the case against them.
48As a result, most Defendants deny both liability and damages that are pleaded. It is only after relevant productions are made and more importantly, after examinations for discovery have taken place, that parties are in a position to determine whether certain parties should be dismissed from the action and whether formal admissions can be made. As a result, in negligence claims such as the instant action, it is often the case that parties change their positions from that articulated in their pleadings. That does not constitute a change in the litigation landscape, as described in Handley Estate and other cases.
49Ms. Carter argues there is an agreement between the opposing parties that has resulted in a realignment of their positions that has somehow had a detrimental impact on the Plaintiffs; she asserts “the Plaintiffs have been left in the dark.” I reject this submission as it does not accord with the evidence or the law and it is without merit. To the contrary, the position of the Plaintiffs for trial is more advantageous; they need not concern themselves with proving liability. Prior to July 2021, the Plaintiffs had the burden of proving both liability and damages at trial. After the admission of liability, the trial will only concern the damages of the Plaintiffs. From the perspective of the Plaintiffs, the liability admission should have been welcomed by them because it meant that the trial would be shorter, less costly and more focussed. The court encourages parties to make formal admissions on issues such as liability, causation and damages and to agree on what issues cannot be resolved and must be determined by the trier of fact. This practice is in the best interests of the parties and of the court.
50I concur with the comments of Justice Perell in Poirier v. Logan, 2021 ONSC 1633, 65 C.P.C. (8th) 390, at para. 57 where he stated, “I agree that a settlement agreement by one litigant to cooperate with another litigant be that other a friend or a foe does not necessarily fundamentally alter the litigation landscape or the adversarial orientation of the litigation.” This is a determination that must be made based on the facts of a particular case. In the instant case, the Plaintiff’s “litigation strategy” is not impacted by the admission of liability; to the contrary, it simplifies the case for the Plaintiff.
51Disclosure of a litigation agreement is required when the litigation landscape is changed by it. In other words, when the agreement changes the dynamics of the case such that a party isn’t aware of the claims that must be defended at trial or what positions other parties will take. Often, the agreement is a Mary Carter agreement between a Plaintiff and a Defendant which guarantees the Plaintiff a certain amount of money and caps the exposure of that Defendant to that amount. The non-settling Defendant however then has a different exposure and the efforts of the Plaintiff and the settling Defendant are aligned against the non-settling party or parties. Thus, fairness requires that such agreements be disclosed in order to “know the reality of the adversity between the parties”: Moore v Bertuzzi, 2012 ONSC 3248, 110 O.R. (3d) 611, at paras. 75-79.
52In Handley Estate, the Court quoted from Aviaco International Leasing Inc. v. Boeing Canada Inc. (2000), 9 B.L.R. (3d) 99 (Ont. S.C.) stating the question to be asked is “Do the terms of the agreement alter the apparent relationships between any parties to the litigation that would otherwise be assumed from the pleadings of expected in the conduct of the litigation?” In this case, the admission of liability does not alter the relationships between the Plaintiffs and the Defendants. All of the Defendants from the outset were aligned against the Plaintiffs in their interest to minimize the damages arising from the admitted negligence to those that would not have been incurred but for the negligence. That is the standard and expected position of Defendants in a tort action. On the other hand, Mary Carter and Pierringer agreements between Plaintiffs and one Defendant which have the effect of changing the previously adversarial relations into cooperative ones to essentially work together to place liability on another Defendant fundamentally change the landscape and must be disclosed to ensure trial fairness.
53I do not find that the Plaintiffs are in any way disadvantaged by the agreement on liability nor is there any basis for ordering the particulars of any apportionment agreement between the Defendants. It is of no moment to the Plaintiffs.
Motion for Directions
54The motion by the Defendants for directions arises from the service of a second expert report from Janterra that was served on June 28, 2022 (“the second Janterra report”). In that report, the expert calculates losses based on a hypothesis that if the 2010 explosion had not occurred, by July 2015 the apartment building at 399 Markham Road would have had a diminished value of $10,400,000 which the Plaintiffs would have leveraged to purchase a property that has been identified at 730 St. Clarens Avenue in Toronto for the sum of $25,000,000. The Janterra report calculates the value of the St. Clarens property as of the date of the report, June 2022, at $85,500,000. The Janterra report calculates the loss to the Plaintiffs from the inability to reinvest at approximately $60,000,000. This loss is advanced in addition to the diminution in value of the building and other itemized corporate losses, as set out in the Statement of Claim and which formed the subject of the first report from Janterra served in 2019.
55Counsel for the Defendants objected to the assertion of this claim, while the solicitor for the Plaintiffs stated that the pleadings were broad enough to encompass this type of claim and at the time the statement of claim was issued, the Plaintiffs did not know what the damages were arising from the explosion. In August 2023 the Defendants served a motion seeking the Court’s direction concerning the damage claims of the Plaintiffs.
56Since the parties did not agree on the propriety of the claim, by way of my case management order of October 3, 2023, I directed the motion for directions be scheduled.
Positions of the Parties
The Moving Defendants
57The Defendants state that this type of loss is not contained in the statement of claim, and has not been advanced. Of note, in my endorsement of October 20, 2021, the Plaintiffs were directed to circulate a draft proposed amended statement of claim articulating all of the damages being advanced at trial. If this claim was being put forth, it should have been the subject of proposed amendments contained in the motion I heard March 4, 2022. This claim was not included, is new and was not the subject of documentary discovery and the Plaintiffs were not asked about it on their examinations for discovery. The Defendants state that non-compensable prejudice will result if this type of claim is allowed to be advanced at this point in the litigation. Finally, the Defendants submit that if the Plaintiffs are allowed to call the evidence about the reinvestment loss at trial, the action should be struck from the trial list so that further productions, discovery and possibly expert opinions can be obtained.
The Plaintiffs
58The Plaintiffs take the position that the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 do not provide for motions for directions from the Court and that s. 146 of the Courts of Justice Act, R.S.O. 1990, c. C.43 preclude me from making an order since the relief is substantive in nature. Ms. Carter in her materials likens the Defendants’ motion to a partial summary judgment motion, submitting that the Defendants are attempting to strike portions of the claims of the Plaintiffs prior to trial. She submits that as the case management judge, there is no jurisdiction to make an order dealing with the ambit of the claims at trial.
59The Plaintiffs argue that the claims for damages are properly pleaded, including the reinvestment claims. The individual Plaintiffs were questioned for discovery and the solicitors for the Defendants chose not to ask questions about the specific claims. If the pleadings were not specific about the damages, the defence should have demanded particulars.
60Counsel submits that at the time the statement of claim was issued, the Plaintiffs could not have articulated the damages, as they were unknown. The claim indicated that the damages would be particularized prior to trial and by serving the second Janterra report, the Plaintiffs were complying with the Rules.
Analysis
61At the outset, it is necessary to address the issue raised by counsel for the Plaintiffs that in my role as the case management and trial judge, I do not have jurisdiction to deal with this motion. Ms. Carter states that she is ready to proceed to trial and wishes a trial date and submits that “only a trial judge can determine whether an expert report is relevant and this determination should be made at trial…” I do not accept this submission. That is incorrect both as a practical matter and is contrary to the law and to the Rules of Civil Procedure.
62I was appointed the case management judge by the Regional Senior Justice in 2021, taking over from Justice Ferguson. At the request of counsel and with the consent of all counsel, I agreed to be the trial judge. A case management judge appointed pursuant to Rule 77 is in a different position than a “regular” motions judge. The motion for directions arises from the delivery of an expert report that purports to quantify the losses of the Plaintiffs arising from the explosion. Defence counsel take the position that the theory of the losses articulated in the report is not pleaded in the amended statement of claim and therefore, cannot be advanced at trial.
63Trial judges make rulings on evidence as part of their adjudicative functions. Most often these rulings are made during the trial, but if a trial judge is appointed in advance of the trial date, a trial management meeting may be convened to address any issues that impact the trial. For example, if there is an issue about the admissibility of certain evidence, that can be addressed by the trial judge in advance of the commencement of the trial. In my view, it is preferable that such issues be determined prior to trial so counsel can properly prepare for the trial and do not have to wait for the issue to be determined during the trial, which may necessitate an adjournment, resulting in wasted costs, court time and delay. Trials should proceed as smoothly and as efficiently as possible, to benefit the litigants, counsel and the Court.
64Indeed, the Plaintiffs previously took the position that the determination of whether the individual Plaintiffs could assert damage claims should be left to the time of trial. I disagreed and required the Plaintiffs motion to amend the claim be brought before me, prior to trial, as part of my duties as case management judge. That approach was confirmed by the Court of Appeal.
65In my reasons dated March 4, 2022, I observed, “In my view, it is incumbent on a Plaintiff to describe the case that will be advanced at trial at the earliest date. It makes no sense to fix a trial date not knowing what the evidence at trial will be or how long the trial will take. Furthermore, a Defendant is entitled to know the case it has to meet at trial; there is no reason for any ambiguity or uncertainty about how the Plaintiffs’ case will unfold at trial or what theories are being advanced and what evidence will be called.” I remain of that view and I reject the submission that as the case management and trial judge I do not have the ability to make an order dealing with the evidence or the ambit of proper claims in advance of the trial.
66A judge of the Superior Court can make orders while performing case management duties or at a pretrial or at a case conference; a judge has the ability to control how an action proceeds, and this is a broad power, the goal of which is to ensure a fair, efficient process: Abrams v. Abrams 2010 ONSC 2703, 102 O.R. (3d) 645.
67Rule 50.13(6) states that a judge at any case conference can make a procedural order, make an order for interlocutory relief or give directions, inter alia. Rule 1.04 states that the Rules “shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits and in applying these Rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues…” [emphasis mine].
68As my colleague Justice Koehnen eloquently noted in Miller v. Ledra, 2023 ONSC 4656, at para. 37, “Judges must be free to assume greater control of the court process… Judges must have the ability to determine, with the help of the parties, what information the judge needs, how best to get it to the judge and what procedure is proportional to the issue at hand…”
69In my view, as the case management and trial judge, I am in the best position to make rulings on this case. There is no advantage to waiting until trial to rule on whether a proposed damages claim is contained in the pleadings, has been advanced from the outset or is something new that results in prejudice to the opposing parties.
70Ms. Carter submits that the Defendants’ motion for directions is in reality another partial summary judgment motion or a Rule 21 motion. I do not accept this statement. Pleadings define the issues for a case; they define what productions are relevant, the scope of the questions at the examination for discovery and the evidence for trial. Pleadings are important and they matter. From the time I assumed the role of case management judge, the Defendants have been requesting clarification of the nature of the damages sought as a result of the explosion. In order to ensure that there was no uncertainty about whether the proposed damage claims were permissible pursuant to the pleadings, in my order of October 20, 2021, I directed the Plaintiffs to articulate the case against the Defendants and I stated, “The events giving rise to this lawsuit occurred more than 11 years ago; that is ample time for the Plaintiffs to determine the case against the various defendants. Barring some unforeseen circumstance, I see no reason why any further amendments to the pleadings would be required in the future.”
71A Plaintiff cannot assert any damage claim they wish at trial; it must be a proper claim, one that is set out in the Statement of Claim and for which there is evidence and which is permissible at law.
72I have reviewed the statement of claim. It claims the following losses: those arising from the high vacancy rate due to the remediation work that was necessary after the explosion; the loss of the opportunity to collect parking fees due to the ongoing work; losses arising from the ability to collect rental fees for units that could not be constructed during the renovations; and losses arising from the lost chance to raise rents on the 250 units that were rented at the time of the explosion; lost time of the Plaintiffs dealing with insurance issues; losses of the Plaintiffs dealing with various tenants; diminution in the fair market value of the building; and expenses incurred by the Plaintiffs arising from the explosion.
73The existing pleading contains the boilerplate phrase “The full extent of the Plaintiffs damages are not yet quantified, but particulars of same will be provided prior to the trial of this action.” It is clear from reading the Statement of Claim that while it does make reference to the diminution in value of the building, it does not reference any theory that but for the explosion, the Plaintiffs intended to use the value of 399 Markham Road to purchase another apartment building which would then increase in value to the date of trial, resulting in a further loss to the Plaintiffs.
74In the affidavit of Mr. Norton filed in support of the motion for directions, he deposes that there was no production about the reinvestment claim as part of the pre-discovery process, nor was it mentioned by any of the three Plaintiffs at their respective discoveries. Specifically, there was no disclosure of a plan to purchase another apartment building located on St. Clarens or any other location, so no questions were posed about that building, or any building, its value, or the plan to buy another building using the 399 Markham Road to do so.
75The Plaintiffs had delivered a prior report from Janterra, one dated February 8, 2019 (“the first Janterra report”). Presumably, that was the expert evidence the Plaintiffs intended to call at the original trial that was scheduled for May 2020. I have reviewed this initial report. Janterra was asked by Ms. Carter to undertake an appraisal of 399 Markham Road as of July 15, 2015 “to provide an estimate of the retrospective market value of the referenced property for potential litigation purposes.” July 2015 is the date that the Plaintiffs entered into a share purchase agreement to effect a sale of the property at 399 Markham. Janterra identified the “extraordinary assumptions and hypothetical conditions” they used in their analysis: that the explosion did not occur and the Plaintiffs had proceeded with their plan to build some additional apartments at 399 Markham Road and on the basis that the stand-alone house would be included in the valuation. Janterra arrived at a figure of $43,900,000 as the value of 399 as of July 2015 had the explosion not occurred. That number was then compared with the valuation of another appraiser which assessed its value at $33,500,000. Thus, Janterra estimated the diminution in value of 399 as of July 15, 2015 to be $10,400,000.
76Nowhere in the 2019 Janterra report does it state that the Plaintiffs planned to use the value from 399 in order to purchase another property; rather, it provides an appraisal of the diminished value of the building as of July 15, 2015. The Janterra opinion on the diminution in value of 399 would have been the expert evidence on damages had the action proceeded to trial in May 2020, along with the other miscellaneous damages set out in the statement of claim.
77Following the release of my decision on June 3, 2022 refusing to allow the individual Plaintiffs to assert personal losses arising from the explosion, Ms. Carter sent an email to counsel dated June 28, 2022 in which she enclosed the second Janterra report, stating “The Plaintiffs have now gone to the expense of having the current value of the damages of 1815 related to the loss in diminution in value of 399 Markham first quantified in February 2019 updated and appraised by the expert…”
78In paragraph 111 of her affidavit Ms. Carter confirms that following the release of my reasons in June 2022 precluding the Plaintiffs from advancing individual losses, the Plaintiffs “asked the appraiser to assume that the $10.4M shortfall identified by the Plaintiffs as the diminution in value as of July 2015 had been invested by the numbered company into the rental apartment building real estate market in 2015…the purpose of the exercise was to determine the current value of a separate but additional building that could have been purchased in 2015 with the shortfall resulting from the diminution in value.”
79The second Janterra report is not simply an updated calculation of the losses arising from the diminished value in 399; rather, there was a new assumption added as a foundation of the new opinion. In the 2022 report, Janterra was asked to assume that the Plaintiffs would have used the value of 399 to invest in another property in July 2015 which the Plaintiffs would continue to own. In the second report, as part of the hypothesis upon which the damages are calculated, Janterra identifies the St. Clarens property as the one that would have been purchased by the Plaintiffs in August 2015 for a price of $24,000,000. The valuators estimate the value of St. Clarens as of June 2022 at $85,500,000 and that amount is being sought as damages arising from the 2010 explosion from the Defendants.
80A comparison of the two Janterra reports makes it clear that while the first report contains an appraisal of the value of 399 as of July 2015, it says nothing about any plan to use funds from that building to purchase another commercial property. The second Janterra report cannot be described as an update of the 2019 report because it contains a new theory which forms the basis for its calculations of loss. Instead of providing an updated value of 399, the second Janterra report quantifies losses to the Plaintiffs arising from a plan to acquire a second property in July 2015 which has increased in value resulting in new and different losses to the Plaintiffs.
81Ms. Carter disputes that the theory about reinvestment contained in the second Janterra report is new. She asserts that from the outset the Defendants have known that the Plaintiffs intend to recover “all losses” arising from the explosion and further that the Defendants “cannot preclude the Plaintiffs from advancing the claim because it is unpleaded.” I disagree. A Plaintiff must articulate the losses that are being claimed from a negligent Defendant. A Plaintiff cannot employ broad-brush language in a statement of claim such as “The Plaintiff has sustained losses which are unknown at this time but full particulars will be provided closer to trial” and ten years later, serve a damage calculation that is not contained in the pleading, is different than a previous calculation, and did not exist at the time of the examination for discovery.
82Had the reinvestment theory been articulated from an early date, the Defendants would have sought financial documentation from the Plaintiffs and from 1815 and questions would have been posed at the discoveries arising from the theory. Instead, at his discovery held in 2017, Mr. Avedian testified that he and Mr. Petti and Mr. D’Orazio had purchased 399 and planned to retain it indefinitely, there was no intention of selling it. Mr. Norton in his affidavit states that prior to receiving the Janterra June 2022 report, there had been no suggestion that the Plaintiffs were advancing a claim based on a plan to purchase another property in July 2015 as an investment, which was precluded by the explosion.
83Ms. Carter argues that because the losses to the Plaintiffs had not crystallized by the time the statement of claim was issued, there is nothing wrong with serving an expert report that uses a hypothetical as a basis for the calculation. I agree with that proposition generally; however, opposing counsel must be advised at the earliest possible date, certainly by the time of the examination for discovery, of the basis of the claim for damages so that proper documentary production can be made and questions can be asked at the discovery stage. The theory of loss advanced by a Plaintiff cannot be a moving target; it must be clearly articulated with proper productions and the defence must be given an opportunity to respond to it, usually through its own expert assessment of the loss.
84The Plaintiffs in this case may allege that as a result of the explosion, it was difficult to rent apartments and the vacancy rate increased resulting in financial losses; that is pleaded in the statement of claim. The Plaintiffs may allege that as a result, the value of 399 diminished. However, it is completely different to assert that as a result of the explosion the plan to purchase another property and hold onto it for investment was thwarted, when that damage is not pleaded and was not articulated at the examination for discovery.
85At this juncture, on a case which arises from a 2010 explosion, there cannot be any mystery about the nature of the claims these Plaintiffs intend to advance at trial because of the explosion. The first trial date was 4 years ago and at that time, the expert reports the Plaintiffs had served did not describe the reinvestment claim. Had the trial proceeded in February 2020 with the Janterra 2019 report, the Plaintiffs would not have been permitted to advance this reinvestment theory since it was not contained in the expert report from Janterra.
86Had the Plaintiffs not included this new theory in the second Janterra report but simply updated the first report, the trial would have proceeded as planned in January 2024. The Plaintiffs cannot complain of delay and an inability to get to trial when the theory of the Plaintiffs’ losses continues to change. This action has had two fixed trial dates and has been in the system for a dozen years. In my view, it is unfair to the Defendants, who have admitted liability for the explosion, twelve years after the case was commenced, to face a new theory of loss, not contained in the Statement of Claim, quantified at some $60,000,000. The defence argues non-compensable prejudice would arise if this new theory is allowed at this late date and I agree.
87The comments contained in my decision of June 3, 2022 are applicable to this motion for directions. I stated, “In my view, the prejudice to the Defendants at this juncture cannot be answered by simply saying that further productions can be made, further examinations for discovery on the personal claims can be held and the Defendants can secure additional expert reports. That is not fair and it certainly not in the interests of justice to delay this case…there has been ample time for the Plaintiffs to articulate that through an unequivocal amendment to the Statement of Claim to claim such losses.” (para. 66)
88Counsel for the Plaintiffs had stated repeatedly that she has been attempting to obtain a trial date since the May 2021 decision of the Court of Appeal ordering an expedited trial date. Given the history of this action, which Justice Pepall described as “tortuous”, I must comment on the position of the Plaintiffs that they are ready and anxious to proceed to trial. Whether a case is ready for trial is not determined by its age; rather, it is determined by the state of affairs taking into account the issues to be adjudicated by the court and the state of the evidence. A case is not ready for trial if there are interlocutory motions to be heard. Nor is a case ready for trial if the necessary expert reports have not been exchanged or if the examinations for discovery have not been completed.
89While I concur that this case needs to move forward to trial, and I am mindful of the direction from the Court of Appeal for an expedited trial, as I have noted repeatedly, that cannot occur until all parties are ready and each side knows the case to be met at trial. From the time I assumed the role of case management judge, the solicitors for the defence have been requesting clarification of the damages being sought at trial while the Plaintiffs took the position the damages had been quantified and if there was any concern about whether the damages could be asserted, the trial judge could make the determination after the trial commenced.
90On October 14, 2021 I wrote, “I concur that the Defendants must know the case they will meet at trial and that the Plaintiffs must articulate their case now. Pleadings delineate the issues in a lawsuit and form the basis for the evidence at trial. Until the pleadings are finalized, it is difficult to move forward with preparation for trial. The events giving rise to this lawsuit occurred more than 11 years ago; that is ample time for the Plaintiffs to determine the case against the various Defendants. Barring some unforeseen circumstance, I see no reason why any further amendments to the pleadings would be required in the future.”
91The motion by the Plaintiffs to amend the statement of claim and the appeal of that order took almost 2 years to complete. Following that, the issue of damages remained uncertain and necessitated another motion and decision from the Court.
92I have been clear in my case management endorsements that in ensuring this case is ready for trial requires the Plaintiffs to articulate the damages being sought and provide evidence of how the damages are calculated. That is not a novel concept, but is a requirement in any case founded in negligence. A Plaintiff cannot plead broadly in a statement of claim and take the position that any and all damage claims will be allowed to be advanced at trial. As I have noted previously, a Defendant must know the case he or she has to meet at trial; this is a fundamental principle to ensure a trial is fair.
93At this juncture, on a case where the cause of action arose 14 years ago, which has had 2 fixed trial dates, and where the limitation period for asserting new claims has long since passed, there is clearly non-compensable prejudice that would result to the Defendants should the new reinvestment claim be allowed. The motion record of the Plaintiffs does not provide any explanation for the delay in advancing this claim of damages. It is unfair to the Defendants and the reinvestment theory will not be allowed.
Motion for Recusal
94The Plaintiffs seek an order that I recuse myself both as case management judge and as the trial judge. They assert that there is a reasonable apprehension of bias as a result of the fact that my child is articling at the law firm that represents the third party (“the law firm”).
95The Plaintiffs do not assert actual bias; rather, they argue that I must recuse myself from acting both as the case management judge and the trial judge solely because of my child’s employment at the law firm that represents the third party. Mr. Avedian states that the Plaintiffs do not feel they can get a fair trial.
96The Defendants submit that following the dismissal of the Plaintiffs’ motion to amend the pleadings to allow the Plaintiffs to assert personal losses, the Plaintiffs no longer wished to have me case manage the action or be the trial judge. They argue the motion is a tactical one designed to end my involvement because they dislike the orders I have made on the case. Counsel submits that the Plaintiffs are engaged in “judge shopping” which cannot be countenanced by the Court.
Analysis
The issue for my determination is whether solely because my child commenced articling at the law firm in July 2023, I must recuse myself because the Plaintiffs state they have a reasonable apprehension of bias. It is not disputed that since my child commenced working at the law firm she has had no contact with the file and has no knowledge about the file or any involvement in it.
The Law
97The test as set out by the Supreme Court of Canada to determine whether a reasonable apprehension of bias has been established is well settled: “the apprehension of bias must be a reasonable one, held by reasonable and right-minded persons, applying themselves to the question... What would an informed person, viewing the matter realistically and practically—and having thought the matter through conclude? Would he think that it is more likely than not that the decision-maker whether consciously or unconsciously would not decide fairly?” The grounds for this apprehension must however be substantial...” Committee for Justice and Liberty v. National Energy Board, [1978] 1 S.C.R. 369.
98The objective standard “rests on serious grounds, in light of the strong presumption of judicial impartiality.” Wewaykum Indian Band v. Canada, 2003 SCC 45, [2003] 2 S.C.R. 259, at para. 76. A party alleging reasonable apprehension of bias must provide serious and substantial evidence to rebut the strong presumption of impartiality.
99The law is clear that the bar for the recusal of a judge is high, because of the strong presumption of impartiality and that there must be serious and convincing evidence on which the application is made: N.R.G. v. G.R.G., 2017 BCCA 407, 5 B.C.L.R. (6th) 319, at para. 66.
100A motion for recusal requires a real likelihood or probability of bias based on cogent evidence: Yukon Francophone School Board, Education Area #23 v. Yukon (Attorney General), 2015 SCC 25, 2015 S.C.C. 25, [2015] 2 S.C.R. 282, at para. 25.
The Evidence
101In support of the motion Mr. Avedian, Mr. D’Orazio and Mr. Petti have sworn affidavits dated December 7, 2023. The affidavits of Mr. D’Orazio and Mr. Petti simply say they agree with the contents of Mr. Avedian’s affidavit and believe they will not get a fair trial if I remain the trial judge. When I make reference to Mr. Avedian’s affidavit, I am including the other Plaintiffs as well, since their affidavits do not add to the evidence.
The Survey
102In the Plaintiffs’ motion record, there is included a survey conducted by Mainstreet Research Survey. It is not an expert report, as contemplated by Rule 53.03 of the Rules of Civil Procedure. According to the report, Mainstreet conducts market research and public opinion research. It conducted some sort of survey of a group of people asking, “If you were bringing a civil lawsuit and you learned that the trial judge’s son had been working for the opposing lawyer’s law firm without your knowledge during the trial, do you believe that you would get a fair trial?”
103I place no weight at all on this survey, which is not signed by the author, does not indicate the group who was interviewed or how the interview was conducted, and poses a very broad question that is not the same factual matrix of the case at hand.
104Had the Plaintiffs wished to rely on this survey as part of the evidence for their motion, it needed to be presented as an expert opinion, conducted by a properly qualified expert, with a form 53 certificate signed confirming the duty to the court, on issues of relevance to the proceeding. Any survey sought to be introduced as evidence must be properly designed and conducted in an impartial manner: Mattel Inc. v. 3894207 Canada Inc., 2006 SCC 22, [2006] 1 SCR 772, at para. 43.
105The Mainstreet survey meets none of the criteria identified in the Mattel case. It is unclear who conducted the poll or how the results were interpreted. The question itself is the wrong question; it does not identify in what capacity the child of the judge worked at the law firm, which is relevant. For example, if a child of a judge worked for the technology department or as a member of the cleaning staff, that is a different situation than if he or she was a partner at the law firm. The question also does not include the fact that the child of the judge has never had any involvement or knowledge of the case that is before the judge. The test as articulated by the Supreme Court of Canada (Wewaykum Indian Band v. Canada) is an objective test whereas the question posed in the poll is a subjective one, seeking answers from all of the people who completed the poll.
106The poll is of no assistance to me in the determination of the recusal motion. Furthermore, it does not meet the requirements set out in Rule 53.03 for the admission of expert evidence.
107The case law is clear that certain criteria must be met in order for an expert opinion to be admissible as evidence in a case: It must be relevant; it must be necessary to assist the trier of fact; there must not be an exclusionary rule; and the expert must be properly qualified: R. v. Mohan (1994), 89 CCC (3d) 402 (S.C.C.). The poll meets none of the criteria.
108A properly qualified expert has a duty to the court to provide an impartial, independent, and unbiased opinion on a relevant issue in an action. The requirements of independence and impartiality go to the admissibility of the opinion as well as to its weight. At the threshold admissibility stage, the expert witness must demonstrate an awareness of their duty to the court and a willingness to carry it out. See White Burgess Langille Inman v. Abbott and Haliburton Co., 2015 SCC 23, [2015] 2 SCR 182, at paras. 32 and 45–46. The poll does not identify the author and there is no way of determining impartiality or reliability. There is no probative value at all to the poll. I decline to consider it on this motion, for the reasons I have identified.
109In his affidavit, Mr. Avedian states that my involvement as case management judge “has caused significant delays and we hereby withdraw our agreement to have Justice Wilson act as our trial judge in this matter.” He asserts that the Plaintiffs have been ready for trial since 2021 and that my role as the case management judge has prevented them from securing a new trial date. Mr. Avedian states that learning that my child is an articling student at the firm representing the third party makes him “very concerned that we would not get a fair trial with Justice Wilson as our trial judge.”
110Prior to the issue of my daughter’s employment with the firm, Mr. Avedian states “I was starting to get concerned that she [Justice Wilson] was beginning to feel biased against us.” Mr. Avedian also states that he disagrees with my decision on the pleadings motion from 2022. It is clear that Mr. Avedian disagrees with the orders I have rendered on this case. Mr. Avedian blames the Defendants for the delays in moving forward to trial and for the fact that after the Court of Appeal directed an expedited trial, that has not taken place.
111Mr. Avedian’s affidavit reveals an incorrect understanding of what has transpired in this case since I was appointed the case management judge. I do not say this in a critical fashion; Mr. Avedian is not a lawyer and I understand that the Plaintiffs want this case to proceed to trial. He believes that my involvement as the case management judge has caused delays when the Plaintiffs have been ready for trial, and he states that no further trial management is required. Mr. Avedian’s view that the progress of the action has been adversely affected by my role as case management judge is not supported by the Court record. With respect, Mr. Avedian cannot determine that it is unnecessary to conduct further trial management and that all that is required is the fixing of a trial date. This case has been in the system for 12 years and I have been the case management judge for 2.5 years. In that role, I am in the best position to determine when a case is ready for trial, a point that has been noted by Justices Huscroft and Pepall.
112The dissatisfaction evinced by Mr. Avedian with my decision on the pleadings motion and with my various case management orders does not form the basis for a reasonable apprehension of bias. In Beard Winter LLP v. Shekhdar, 2016 ONCA 493, at para. 11 Justice Doherty said, “...the personal opinion of the losing litigant as to the quality and correctness of the court’s decision counts for little when assessing a partiality claim.”
113I take guidance from the Ethical Principles for Judges prepared by the Canadian Judicial Council for the use of judges. Section 5.C.8 states, “Generally speaking, it would not be problematic for a judge to sit on a case involving a lawyer from a firm in which the close friend or family member is a member or employee, provided that the friend or family member has not been involved in the matter. However, there may be circumstances here it would be inappropriate for a judge to hear such a case. For example, where the law firm is very small (such that there is a greater risk of the perception of lack of impartiality) or where the law firm stands to gain or lose significantly by the outcome, such that the judge’s decision would result in a monetary or reputational gain or loss to the close family member or friend or former colleague.” [i]
114The law is clear that the mere fact that a relative close to a judge is employed by a law firm involved in a case the judge is presiding over does not mean that a judge must not hear the case: Lay v Lay, 2019 ABCA 21, 80 Alta. L.R. (6th) 221.
115The Lay case is very similar factually to the instant case. In that case, the presiding judge heard a summary judgment motion. The judge’s daughter joined the law firm of one of the parties as a lawyer during the course of the case, although she had no involvement with the file. The losing party appealed the judge’s decision and alleged there was a reasonable apprehension of bias on the part of the case management judge. The court dismissed the motion for the judge’s recusal and that decision was upheld in the Alberta Court of Appeal, where the Court found that not only was there no reasonable apprehension of bias arising from the employment of the judge’s daughter at the firm involved in the case, but also there was no requirement for disclosure of the employment to the parties.
116The comments of the Alberta Court of Appeal in Lay v. Lay, at para. 44 are directly on point to the case before me, “Canada has many large law firms. At the same time, it is not uncommon for a judge’s children to become lawyers, just as many judges have spouses, siblings, or other close relatives who are lawyers. A rule that would bar judges from hearing any case where counsel is from the same law firm as the judge’s close relative would be unworkable...It would put an unacceptable strain on judicial resources and create needless delay in the courts.”
117Toronto is a large city with many law firms. The fact that my daughter is employed as an articling student at the law firm of one of the parties on its own, does not meet the onus required to displace the strong presumption of a judge’s impartiality. The determination of whether a situation gives rise to an apprehension of bias in the mind of a reasonable person must be determined based on the circumstances of a particular case. In the instant case, the evidence is uncontradicted that my child knows nothing about this action and has had no involvement. She is an articling student, with no financial interest in the outcome of any case at the firm. Further, the affidavits of the Plaintiffs do not provide any serious or substantial grounds to displace the presumption of my impartiality. Rather, the evidence sets out the displeasure with my various rulings on the case. A party’s unhappiness with a judge’s decisions on a case does not form the basis for a reasonable apprehension of bias.
118In his affidavit, Mr. Avedian states repeatedly that there was some obligation on me to advise all parties that my child had commenced her articles at the Defendant law firm. I do not accept that view and it is contrary to the jurisprudence. In the Lay case, the Court specifically addressed that argument, noting at paras. 84 and 93, “The case management judge was not obliged to disclose to the appellants the fact that the respondents’ law firm had recently employed his daughter before he signed his January 30 or April 20, 2017 judgments. She did not appear before him as an advocate and had no involvement with the file. ...If a judge concludes that disclosure is not obligatory, he or she should not do so. Unwarranted disclosure may be harmful...”
119I agree with the sentiments expressed by Justice Doherty in the Beard Winter case where he stated, at para. 10,
Judges do the administration of justice a disservice by simply yielding to entirely unreasonable and unsubstantiated recusal demands. Litigants are not entitled to pick their judge. They are not entitled to effectively eliminate judges randomly assigned to their case by raising specious partiality claims against those judges. To step aside in the face of a specious bias claim is to give credence to a most objectionable tactic.
120The allegations made by the Plaintiffs are specious; they are devoid of merit and are seemingly rooted in unhappiness with the manner in which I have case managed this action and a misunderstanding as to why the case has not proceeded to trial. To allow the Plaintiffs to end my involvement as case management judge or as a trial judge would be to acknowledge there is some merit to the allegations of bias when there is none. The motion for recusal is dismissed.
Conclusion
121The motion of the Plaintiffs to strike the pleadings of the Defendants is dismissed.
122The motion for directions is granted with the conclusion that the Plaintiffs cannot now assert the theory of damages, the reinvestment theory, as contained in the Janterra report dated June 2022.
123The motion for my recusal is dismissed.
124In the decision of the Court of Appeal dated April 3, 2024, the Court noted, “Depending on any steps taken in response to that order, new pre-trial and trial dates can now be set.” I agree. I will convene a case conference to fix a new trial date and pre-trial date and to set a timetable for further steps dealing with expert reports and other trial issues.
125If counsel cannot agree on costs, I may be contacted.
Darla A. Wilson Date: April 22, 2024
[i] [Canadian Judicial Council, Ethical Principles for Judges (2021), 2021).